Table Of Content

S Roadmap to a o c i a Social Europe l E u Edited by Anne-Marie Grozelier, Björn Hacker, r Wolfgang Kowalsky, Jan Machnig, o Henning Meyer and Brigitte Unger p e R e p o r t October 2013 Contents Introduction 1 By Wolfgang Kowalsky and Henning Meyer Part I – The European Crisis and Social Europe Democracy, Solidarity And the European Crisis 4 By Jürgen Habermas Europe Is Trapped Between Power And Politics 14 By Zygmunt Bauman Pragmatism, Idealism And European Demoicracy 19 By Kalypso Nicoalidïs What Is The Social Dimension Of The EU? 25 By Martin Seeleib-Kaiser What Does A Social Europe Look Like Today? 29 By Jean-Paul Fitoussi and Xavier Timbeau Social Policy Will Be Critical To A Sustainable EMU 31 By Simon Deakin Social Europe Is The Only Solution 34 By Robin Wilson Europe’s Democracy Deficit: Putting Some Meat On The Bones 37 Of Habermas’ Critique By Steven Hill The Euro-Dividend 44 By Philippe van Parijs i Part II – European Trade Unions’ Vision Of A Social Europe Why We Need An Ambitious Social Europe 48 By Bernadette Ségol (ETUC) A Social Europe Requires A Change Of Course For The Young Generation 51 By Berthold Huber (IG Metall) The Social And Political Scope Of EU Reform Policy 54 By Ignacio Fernández Toxo (CC.OO; ETUC) And Cándido Méndez (UGT) A Social Dimension For A Changing European Union: The Irish Case 57 By David Begg (ICTU) A Concept For Deepening The Social Dimension Of The European Union 62 By Frank Bsirske (ver.di) and Klaus Busch Towards A More Social Europe – A Change Of Course Is Necessary 71 By Anne Demelenne (FGTB), Claude Rolin (CSC) and Bernard Noël (CGSLB) A Social Dimension For A Changing European Union 73 – The Bulgarian Perspective By Plamen Dimitrov (CITUB) A Social Dimension For A Changing European Union 76 – The British Perspective By Frances O’Grady (TUC) Austerity Destroys The European Social Model 78 By Yannis Panagopoulos (GSEE) and Kostas Tsikrikas (ADEDY) The Italian Trade Unions’ Proposal For Inclusive Growth 80 In Italy And Europe By Anna Rea (UIL), Fausto Durante (CGIL) and Raffaele Bonanni (CISL) Europe Needs A Change Of Course 83 By Michael Sommer (DGB) Proposal For A Real Social Dimension Of The EMU 86 By Bente Sorgenfrey (FTF) and Harald Børsting (LO-DK) A Social Dimension For A Changing European Union 88 – The Czech Perspective By Jaroslav Zavadil (CMKOS) ii Part III – Action For A Social Europe A Change In Course Towards A Social Europe 92 By Martin Allespach and Jan Machnig How To Finance A Social Europe? 95 By Brigitte Unger Stop The Emergence Of A Liberal European Social Model! 98 By Björn Hacker The Shock Therapy Applied To A Social Europe 101 By Anne-Marie Grozelier What Can The Social Dimension Mean In Times Of Austerity? 104 By Wolfgang Kowalsky A ‘Poldermodel’ For The EU? 108 By Frans van Waarden A Social Europe For Euroland 113 By Joël Decaillon Respect And Promote Wages And Collective Bargaining 116 By Ronald Janssen Evolution Of Social Pacts And Bargaining Decentralisation 119 By Jacques Freyssinet Wages And Competitiveness: The Need For Coordination 121 By Odile Chagny and Michel Husson The 2012 White Paper On Pensions – A Building Block For EU Social Policy? 124 By Florian Blank Questions Of Age Discrimination In Decisions Of The European 126 Court Of Justice By Nadine Zeibig Social Democracy: Trap, Utopia Or New Horizon For Europe? 129 By Pierre Héritier Adapting European Governance To Meet the Social Imperative 131 By Christophe Degryse iii Is Job Creation Useful In Fighting Poverty And Social Exclusion? 134 By Eric Seils ESM: European Social Model Or European Stability 136 Mechanism – Is There A Crash? By Bela Galgoczi A Social Dimension For A Changing European Union: Drifting 143 From The Primary Dividing Up Of Revenues, Inequalities And Crisis By Joël Maurice Social Issues Are Disappearing From The European Project 146 By Michel Fried The European System Of Industrial Relations And The Dynamics Of 148 Transnational Company Agreements By Udo Rehfeldt Social Exchange In The Crisis – 2010 The Turning Point 151 By Jean-Marie Pernot Trade Union Responses To The Attack Of The EU On Wages 153 By Anne Dufresne iv Introduction By Wolfgang Kowalsky and Henning Meyer A roadmap to a Social Europe! That was the ambitious idea laid down in the conclusions of the European Council in December 2012 to respond to the growing anger and frustration all over Europe. The European Commission was supposed to come up with a social roadmap at the European Council in June 2013. But we, and indeed many others, were waiting in vain. Social Europe Journal, together with its partners for this project – the European Trade Union Confederation (ETUC), the IG Metall, the Friedrich-Ebert-Stiftung, the Hans Böckler Stiftung and the French institute Lasaire - seized the moment and started an ambitious project. We did not want to wait any longer for an official announcement and instead set out to define what we think the core elements of a sustainable Social Europe should be. Drawing on the best expert and practitioner knowledge, we started collecting views and analyses from all over Europe. The result was a comprehensive online debate and this eBook with 43 articles on different aspects of the European social dimension written in spring and summer 2013. The book has three principal sections: In the first part, some of Europe’s most prestigious thinkers and analysts make the connection between the discussion about Social Europe and the wider European malaise. One cannot discuss the social dimension in isolation but has to link it to the wider debate about the future of European integration if you want to be realistic, up-to-date and relevant. Following this, the second part brings together trade union views ‘from the ground’ across Europe. European political discussions are often perceived as detached from the real lives of people in the member states and the discussion about Social Europe is no exception. Therefore we collected the views of European and national trade union leaders and thus added an important dimension that has often found too little appreciation. In the third and final part, some of the best experts in the field address a series of more specific issues related to the social dimension of the European Union and make recommendations for how to tackle them. Social Europe is at the heart of many controversies and of course not everybody agrees on all aspects. But all the authors of this volume would like to contribute to the discourse about a fairer, socially just and sustainable Europe. And we think they have made a very important contribution. Now, after the German election and with the European elections of 2014 already in sight, the key question about the future of Europe is back on the agenda: What kind of Europe do we want? Politicians struggling to convince reluctant electorates that they should be re elected could do worse than having a look into this eBook to find some ideas to make a new case for Europe, a Social Europe that deserves the name. On 2nd October 2013, the Commission finally published its long awaited communication on the social dimension proposing to create a new scoreboard to allow for better and earlier identification of major employment and social problems. The communication, quite frankly, 1 was disappointing. An initial discussion about an Euroarea unemployment insurance scheme was expected to be part of it, but the Commission thinks – given the national competence of member states – that a ‘substantial treaty change’ is necessary first. The communication also does not propose any new resources to tackle unemployment and social problems in the European Monetary Union, which is also a big omission. The Commission’s solution is to foster mobility, making it easier for people to move around the EU for work. This alone cannot be the solution. More and more, the question is if a social dimension is still compatible with the new economic governance system now emerging in the wake of the Eurozone crisis. Internal wage devaluation and financial rescue packages as permanent new features are in contradiction to a social dimension, whatever form it is meant to take. The core problem is not one of too few indicators but the necessity to fight unemployment more efficiently and to establish a democratic economic governance system in line with the European Social Model. Europe deserves much better than those proposals from Brussels. A change of course is needed and this eBook can hopefully inspire some new policy thinking by providing a collective vision of a different Europe, a real Social Europe. Wolfgang Kowalsky is a policy adviser working in the trade union movement in Brussels. Henning Meyer is Editor of Social Europe Journal and a Research Fellow at the Public Policy Group at the London School of Economics and Political Science (LSE). 2 Part I – The European Crisis and Social Europe Democracy, Solidarity And The European Crisis By Jürgen Habermas The European Union owes its existence to the efforts of political elites who could count on the passive consent of their more or less indifferent populations as long as the peoples could regard the Union as also being in their economic interests, all things considered. The Union has legitimized itself in the eyes of the citizens primarily through its outcomes and not so much by the fact that it fulfilled the citizens’ political will. This state of affairs is explained not only by the history of its origins but also by the legal constitution of this unique formation. The European Central Bank, the Commission, and the European Court of Justice have intervened most profoundly in the everyday lives of European citizens over the decades, even though these institutions are the least subject to democratic controls. Moreover, the European Council, which has energetically taken the initiative during the current crisis, is made up of heads of government whose role in the eyes of their citizens is to represent their respective national interests in distant Brussels. Finally, at least the European Parliament was supposed to construct a bridge between the political conflict of opinions in the national arenas and the momentous decisions taken in Brussels – but this bridge is almost devoid of traffic. Thus, to the present day, there remains a gulf at the European level between the citizens’ opinion and will formation, on the one hand, and the policies actually adopted to solve the pressing problems, on the other. This also explains why conceptions of the European Union and ideas of its future development have remained diffuse among the general population. Informed opinions and articulated positions are, for the most part, the monopoly of professional politicians, economic elites, and scholars with relevant interests; not even public intellectuals who generally participate in debates on burning issues have made this issue their own.[1] What unites European citizens today is the Eurosceptic mindset that has become more pronounced in all of the member countries during the crisis, albeit in each country for different and rather polarizing reasons. This trend may be an important fact for the political elites to take into account; but the growing resistance is not really decisive for the actual course of European policy-making which is largely decoupled from the national arenas. The actual course of the crisis management is pushed and implemented in the first place by the large camp of pragmatic politicians who pursue an incrementalist agenda but lack a comprehensive perspective. They are oriented towards ‘More Europe’ because they want to avoid the far more dramatic and presumably costly alternative of abandoning the Euro. Starting with the roadmap that the European institutions have designed for developing a ‘Genuine Economic and Monetary Union’, I will first explain the technocratic dilemma in which this project is likely to become entangled (I). In the second part I would like to present alternative steps towards a supranational democracy in the core of Europe and the obstacles we would have to overcome on that road (II). The major hindrance, the lack of solidarity, leads me in the last and philosophical part to a clarification of this difficult, yet genuinely political concept (III). 4 I The Commission, the Presidency of the Council, and the European Central Bank — known in Brussels parlance as ‘the institutions’ – are least subject to legitimation pressures because of their relative distance to national public spheres. So it was up to them to present, in December 2012, the first more detailed document in which the European Union develops a perspective for reforms in the medium and long term that go beyond the present, more or less dilatory, reactions to critical symptoms.[2] Within this expanded timescale the attention is no longer focussed on the cluster of causes that, since 2010, have connected the global banking crisis with the vicious circle of over-indebted European states and undercapitalized banks refinancing each other. The important and long overdue ‘Blueprint’, as it is called, directs attention to long-term structural causes inherent in the Monetary Union itself. The Economic and Monetary Union took shape during the 1990s in accordance with the ordoliberal ideas of the Stability and Growth Pact. The Monetary Union was conceived as a supporting pillar of an economic constitution that stimulates free competition among market players across national borders, and it is organized in accordance with general rules binding for all member states.[3] Even without the instrument of devaluing national currencies, that is not available in a monetary union, the differences in levels of competitiveness among the national economies were supposed to even out of their own accord. But the assumption that permitting unrestrained competition in accordance with fair rules would lead to similar unit labour costs and equal levels of prosperity, thereby obviating the need for joint decision-making on financial, economic and social policies, has proved to be false. Because the optimal conditions for a single currency in the Eurozone are not satisfied, the structural imbalances between national economies that existed from the start have become more acute; and they will become even more acute as long as the European policy pattern does not break with the principle that each member state takes sovereign decisions within the relevant policy fields without taking other member states into consideration; in other words, exclusively from its own national perspective.[4] In spite of some concessions, however, until now the German federal government has clung steadfastly to this dogma. It is to the credit of the Commission and the Presidency of the Council that they have addressed the actual cause of the crisis — namely the faulty design of a monetary union that still holds fast to the political self-understanding of an alliance of sovereign states (as the ‘Herren der Verträge’). According to the aforementioned reform proposal, the so-called Blueprint, three essential, though vaguely defined, objectives are to be realized at the end of a path projected to last five years: First, joint political decision-making at the EU level on ‘integrated guidelines’ for coordinating fiscal, budget, and economic policies of the individual states.[5] This would call for an agreement that prevents the economic policy of one member state from having negative external effects on the economy of another member state. Furthermore, an EU budget based on the right to levy taxes with a European financial administration is envisaged for the purpose of country-specific stimulus programs. This would generate scope for selectively focussed public investments through which the structural imbalances within the Monetary Union could be combated. Finally, Euro bonds and a debt repayment fund are supposed to make possible a partial collectivization of state debts. This would relieve the European Central Bank of the task of preventing speculation against individual states in the Eurozone that it has currently assumed on an informal 5